Agenda item

Luned Fôn Jones, Cyngor Gwynedd Audit Manager to present the report.

To accept and approve the content of the Internal Audit Mandate and Charter and support Internal Audit in its operations.

It was explained that since April 2025, when the Global Internal Audit Standards came into force in the UK Public Sector, it was essential that the Audit Service comply with these Standards. It was explained that an Application Note had been submitted which provided a practical framework on how implementation and application could be carried out, provided guidance and explained how the Global Internal Audit Standards on governance – Domain III – apply to the oversight and duties of the Governance and Audit Sub-committee.  One of the essential steps was to approve a charter that includes a mandate and scope and types of Internal Audit work.

It was added that CIPFA had developed a Code of Practice for Internal Audit Governance in Local Government in the UK to interpret and ensure compliance with statutory duties. The Code was aimed at those responsible for effective governance arrangements – namely this Sub-committee.

The Charter sets out the arrangements for an internal audit function to fulfil its purpose. The role of an internal audit included:

·         Supporting the achievement of strategic objectives by providing objective risk-based assurance,

·         Promoting good practice in governance and

·         Advising on governance, risk management and internal control arrangements.

To ensure compliance with the Standards, it was noted that it was the responsibility of this Sub-committee to review and approve the Charter ensuring that there was a clear definition of

·         Purpose, authority and responsibility of Internal Audit,

·         Independence and reporting lines of the Internal Audit function,

·         Scope of work and access rights of Internal Audit,

·         That the mandate confirms that Internal Audit has the legal and institutional authority to operate effectively and provides details of the role and responsibilities of the Internal Audit function,

·         Verify that the Charter and mandate ensure the independence of Internal Audit and protect Internal Audit from undue influence,

·         Supervise and monitor Internal Audit activities to review compliance with the Charter and mandate.

It was asked what was the CJC's internal audit capacity. It was explained that Cyngor Gwynedd provided an internal audit service through a service level agreement, and it was noted that Cyngor Gwynedd's internal audit team consists of an Audit Manager, two Audit Leads, and four Senior Auditors.

It was asked how the current work programme for internal audit would be determined. It was detailed that the annual plan for Ambition North Wales would be drawn up with input from the Chief Executive and Chief Finance Officer. It was confirmed that the Annual Plan will come before this Sub-committee in the future for approval. It was noted that an Annual Plan had not been drawn up at this time as an Audit Charter was first required to produce a Strategy and the Annual Plan. It was explained that a risk assessment was being discussed and that any internal audit work would be drawn up in line with the main risks.

The Sub-committee had been assured that Ambition North Wales was in the process of developing their Corporate Risk Strategy, and a draft had been circulated to officers, and would be submitted to the Sub-committee in due course. It was stressed that it remained early days since the handover of the CJC but that forming a regional Corporate Risk Strategy was a priority and a vital requirement.

It was asked what steps Ambition North Wales and the CJC had taken in terms of publicity, particularly in relation to the intention of keeping residents aware of the functions of the CJC. It was explained that the public interface was the established website of Ambition North Wales and contained information and the statutory duties of the CJC. It was noted that the work that the CJC does was complex and would take time to gather all the information and reach the right audiences.

It was explained that once the funding agreement for the Flintshire and Wrexham Investment Zone was agreed, Ambition North Wales would manage the administration of an investment of approximately £400 million for the promotion and improvement of the North Wales economy. It was noted that the intention was to reach as many communities as possible with the investment. It was highlighted that their long-term ambition was to create new jobs within the economy and encourage future generations to stay in North Wales in high-value jobs. It was added that the intention was to attract talent back to the region and target investment that provides opportunities across key sectors. It was noted that Ambition North Wales was currently in year five of delivering the Growth Deal, which was a 15-year plan and was therefore still in its early days.

Concerns were expressed about how internal audit was being used as a tool that reflects a systematic approach. It was noted that the Charter and the Sub-committee's requirements set out expectations as to what the internal audit should cover and report on, to provide assurance to the Sub-committee regarding the operations of the CJC. It was suggested that, alongside the Corporate Risk Strategy, a Risk Register should be developed to allow the CJC to focus on its priorities. It was expressed that the Sub-committee needs to move towards a systematic approach to implementation. The Section 151 Officer assured that a systematic approach was part of the CJC's rules of financial procedure, and therefore the matters were completed. It was noted that the risk register was part of the CJC's governance requirements and will be developed.

It was noted that members of the local authorities would need a better understanding of how Local Authority contributions were used.

It was elaborated that the Sub-committee must move forward quickly to ensure that they do not fall behind with Audit and to report back to their local authorities appropriately.

It was agreed that the Internal Audit would be on the agenda for the next meeting.